Confidence in Social Security and Medicare soared to all-time highs among both workers and retirees, a somewhat defiant Covid pandemic that destroyed the U.S. economy and the economy of many Americans.
About 72% of retirees and 53% of employees are somewhat or very convinced that social security will continue to pay the same benefits in the future, according to a study by the Finnish Institute for Occupational Safety and Health published on Thursday.
It has only grown from a low of 45 per cent and 28 per cent in recent years, respectively, three years ago.
The numbers were similar for Medicare. Three out of four retirees and 56% of employees were confident in government programs in 2021, compared with 46% and 34% in 2018.
The steady gains in the extreme – millions of jobs lost, more than 570,000 virus deaths and a stock market boost in the early days of a pandemic – probably led to optimism, according to Lisa Greenwald, CEO of Greenwald Research. The 2021 study.
“Social security – the‘ largest ’source of income for more than six in ten retirees – continued uninterrupted during the pandemic,” Greenwald said.
At the same time, social security recipients also qualified for federal stimulus inspections. That support has been awarded over three rounds over the past year, up to $ 1,200, $ 600 and $ 1,400 per person.
These results are now in a 31-year EBRI studyst in, the eyes have some broader observations.
For example, about 80% of retirees are confident in their ability to live comfortably throughout retirement – more than the 76% surveyed in March 2020.
“When we first saw these high reliability figures, they felt like abuse to me,” said CRAig Copeland, a senior researcher at EBRI, and the author of the report. “2020 was such a difficult year for many reasons.”
But trust is a feeling – and it may not fit in with reality, Copeland said.
Funds that pay social security benefits are stressed. A year ago, on Thursday, the Social Security Administration estimated that its funds could run out in 2035.
That doesn’t mean the benefits disappear. At that point, 79% of the promised benefits would be paid. Payroll taxes continue to fund these amounts.
Some have speculated that the expiration date may be faster due to the economic consequences of the Covid-19 pandemic. However, lawmakers are considering measures to increase funding and prevent earnings.
However, the widespread retirement optimism of retirees has some economic implications, Copeland said.
The stock market rebounded since the beginning of last year and retirees have generally invested more conservatively, he said. Retirees also spend most of their discretion on tourism, leisure and entertainment – all of which were curtailed over the past year and were likely to result in less spending.
But the Covid recession will have varying effects on different segments of the U.S. population.
Some — namely, rich, white, and college students — thrive as well, if not better, than pre-pandemic ones. Other groups of workers – the poor, minorities and the less educated – continue to suffer from jobs.
The unemployment rate improved to 6 percent in March, and the U.S. economy added 916,000 jobs, the most since the summer. But more than 8 million jobs have not yet returned from February 2020.
About six out of ten workers who lost their income or jobs during the past year said the pandemic had negatively affected their ability to save for retirement, according to EBRI. By comparison, only one in eight people who did not lose income reported a negative impact.
The study asked 3,017 Americans 25 and older – half workers, half retirees – online from 5 to 25. January.